Abstract: This study investigates the effect of stakeholder participation in project initiation on project performance, with a focus on informal cross-border trade projects in Rubavu District, Rwanda. Grounded in planning theory, the research employed a descriptive research design, utilizing both quantitative and qualitative approaches. A total of 269 respondents were selected through stratified and simple random sampling methods, with data collected via structured questionnaires and interviews. The collected data were analyzed using SPSS Version 25, and the findings were presented through descriptive statistics. The results indicated a strong positive correlation between stakeholder participation in project initiation and overall project performance, with a Pearson correlation coefficient of r = 0.876. Regression analysis further confirmed that stakeholder participation during project initiation is a significant predictor of project performance, with a standardized beta coefficient of 0.312 and a p-value of 0.000, highlighting the importance of early stakeholder involvement in ensuring project success. Based on these findings, the study recommends that project teams actively engage stakeholders from the onset of project planning, provide training on project management best practices, and ensure continuous communication throughout the project to maximize performance and outcomes.